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MasterCard (MA) Rises Yet Lags Behind Market: Some Facts Worth Knowing

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In the latest trading session, MasterCard (MA - Free Report) closed at $476.63, marking a +0.39% move from the previous day. The stock fell short of the S&P 500, which registered a gain of 0.8% for the day. On the other hand, the Dow registered a gain of 0.23%, and the technology-centric Nasdaq increased by 1.14%.

Coming into today, shares of the processor of debit and credit card payments had gained 3% in the past month. In that same time, the Business Services sector gained 8.45%, while the S&P 500 gained 5.2%.

Investors will be eagerly watching for the performance of MasterCard in its upcoming earnings disclosure. The company is expected to report EPS of $3.23, up 15.36% from the prior-year quarter. Simultaneously, our latest consensus estimate expects the revenue to be $6.34 billion, showing a 10.27% escalation compared to the year-ago quarter.

MA's full-year Zacks Consensus Estimates are calling for earnings of $14.37 per share and revenue of $28.12 billion. These results would represent year-over-year changes of +17.21% and +12.06%, respectively.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for MasterCard. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.2% higher. MasterCard presently features a Zacks Rank of #3 (Hold).

In terms of valuation, MasterCard is currently trading at a Forward P/E ratio of 33.05. This denotes a premium relative to the industry's average Forward P/E of 12.24.

It is also worth noting that MA currently has a PEG ratio of 1.8. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Financial Transaction Services industry held an average PEG ratio of 1.01.

The Financial Transaction Services industry is part of the Business Services sector. At present, this industry carries a Zacks Industry Rank of 59, placing it within the top 24% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply to follow these and more stock-moving metrics during the upcoming trading sessions.

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